Apr 16, 2013

Unemployment insurance, job search, and Google

We use Google search data to construct the first high-frequency, location-specific index of job search activity (JSI). After showing the JSI’s validity, we study the effect of increased unemployment insurance (UI) on job search activity. We show that indi- viduals on UI search less than individuals who are unemployed and not receiving UI and that individuals with 0 to 10 weeks of UI remaining search 2.1 times more than those with more than 10 weeks left. We document that the JSI temporarily decreases by 2.1% to 3% in the 4 weeks after expansions and extensions in UI policy. While extensions in unemployment insurance do drive temporary changes in job search, the immediate effects of expansions or expansions are unlikely to result in large changes to unemployment rates.